Manchester United Earnings Fall Wide of Goal

MANU suffers revenue dip, $24M net loss

Manchester United (NYSE:MANU) isn’t finding much luck on the public pitch.

Life on the markets has not been smooth for the world’s largest soccer club since its early-August IPO. The stock has slid roughly 9% since its opening day, including a 2% early Tuesday sell-off after its first quarterly earnings report as a publicly traded company.

Revenues dropped by 25% to $121 million — including a 35% plunge in match-day revenue — and the company suffered a net loss of $24.2 million.

What’s going on?

Simply put, MANU’s team lost its edge, failing to drum up success in either the Champions League (international) or F.A. Cup (domestic) tournaments. Ergo, Manchester United played fewer games, which translates into less revenue.

To help things along, MANU has ramped its sponsorships, such as a recent deal with General Motors (NYSE:GM). But again, such things will mean little unless the club gets back to its winning ways.

On that front, MANU is on the right track. Manchester signed some top players this offseason, including Robin van Persie and Shinji Kagawa, and currently is second in the Premier League table — the top four spots traditionally qualify for the Champions League.

Still, it’s early in the season, and even heavy spending isn’t a fool-proof way to manufacture success in the quirky sports world. Thus, the stock could continue to languish.

Based in Silicon Valley, Tom Taulli is in the heart of IPO land. On a regular basis, he talks with many of the top tech CEOs and founders trying to find the next hot deals and finding out which start-ups are stinkers.

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